Why Emotional Intelligence is Key for Entrepreneurial Success

emotional intelligence in business

Many entrepreneurs go into business for themselves because they have a dream, a skill, and the know-how to make their business work for them. Those are all important qualities for any entrepreneur, but emotional intelligence is often left out of the equation, and it’s just as important as any hard skill.

In fact, many experts argue that emotional intelligence is more essential for business success than any level of “smarts” you may have. To be clear, emotional intelligence is the ability to identify and understand your own emotions and the emotions in others. If you’ve ever been told that you can read people well, then you likely already have some amount of emotional intelligence. 

Emotionally intelligent people are adept at putting themselves in other people’s shoes. They can see challenges from different perspectives, which ultimately helps them to solve complex problems. 

In addition, a higher level of emotional intelligence is beneficial for entrepreneurs in the following ways:

Emotional Intelligence Improves Decision-Making

Decision making is a full-time job for any entrepreneur. You not only have to make decisions regarding your products and services, but also regarding the ways in which you run your business.

It’s worth mentioning that running a business can also be a highly emotional experience. You pour your heart and soul into every aspect, and it can be downright frustrating when something doesn’t go your way, a customer says something negative about you, or you make a careless mistake that affects the caliber of your work.

When emotions get in the way of running a business, it can often cloud your decision making. It’s not always easy to separate your emotions from the facts and logic of the situation, but increasing your emotional intelligence can simplify the process.

In doing so, you become more aware of your emotions so that you’re in a better position to keep them under control. You recognize how they affect your work and can be more resilient when setbacks occur. This way, you’re not making critical business decisions based on a current feeling. 

Avoid Impulsive Decisions

Speaking of decision-making, entrepreneurs are inherently more interested in risk-taking than the average person. Taking the first step as an entrepreneur is a risk in itself.  Entrepreneurs tend to go with their gut and capitalize on opportunities as they arise.

 However, this can also be considered as one of an entrepreneur’s biggest faults. Without understanding their own emotional intelligence, they’re less likely to take a step back and look at the full picture before moving forward with a decision. 

Entrepreneurs should take time to weigh the pros and cons instead of looking through rose-colored lenses. Learning more about your emotions to be more proactive in your decision-making instead of reactive with your emotions after a decision has already been made.

It Helps You Communicate with Others

No entrepreneur is an island. At some point, you’re going to need to rely on the skills and expertise of others, whether it’s hiring an employee, outsourcing to a freelancer, or getting help from a mentor. In addition, sales will be the lifeblood of your business, and entrepreneurs need to have good networking skills and the ability to close sales if your business is going to survive.

 Anytime you’re working with others, be it someone within your business or a customer, it’s important that you’re able to understand their perspective and position. These are what we consider the outward-facing mechanisms of emotional intelligence. They take the form of empathy and understanding, where you are able to comprehend where the other person is coming from, why they feel the way they do, and what you can do to meet them where they are.

When you can demonstrate empathy with your prospective customers, the other person is more likely to open up to you and contribute authenticity to the conversation. As a direct result, you are better able to understand their pain points and needs and adapt your products and services to cater to them. This means more sales for your business and more respect for your brand.

From an internal perspective, emotional intelligence can make you a more effective leader in your business. Leaders at the high level of emotional intelligence push their employees to do their best. They bring out the best qualities in their teams by leading by example, demonstrating compassion, and cultivating strong morale.  Disability is even more important if you plan on utilizing a remote workforce, as you won’t have the advantage of face-to-face conversations. 

Even if you’re not at the point where you need a team, you may get there someday. It’s important to start developing the leadership skills you’ll need now so that you can be as effective as possible when you start to bring others on board.

Remember, it’s almost impossible to have a meaningful conversation with someone if you can’t empathize with them. If you don’t understand the other person’s perspective, both factually and emotionally, the entire communication process is at risk of failing. 

How to Improve Your Emotional Intelligence

Being in tune with your own emotions and those of other people comes more naturally to some than others. Still, that doesn’t mean that you can’t improve your emotional intelligence. In fact, the most driven entrepreneurs take a proactive approach to improving their emotional intelligence so that it can continue contributing to their success.

Turn these tips into habits to increase your EQ organically:

  • Think before you speak and choose your words wisely.
  • Maintain a positive attitude, even when under stress.
  • Look for nonverbal cues, such as body language.
  • Forgive others.
  • Be proactive with conflict resolution.

The more you practice these tips, the more emotional intelligence will work for you. 

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